Who is going to stand up for the utopian possibilities of free markets, private property, and individual liberty in an era when more Americans between the ages of 18 and 29 have a positive view of socialism (51 percent) than capitalism (45 percent)?
Politicians such as Sen. Elizabeth Warren (D-Mass.), Rep. Alexandria Ocasio-Cortez (D–N.Y.), and Sen. Bernie Sanders (I–Vt.) yammer on about the need for "bold, structural solutions" that inevitably involve jacking up government control over more and more aspects of economic and cultural lives. Promises of higher taxes, tighter regulation of business, and policing of political speech on social media are just the beginning. On the Republican right, observes Max Gulker of the American Institute for Economic Research (AIER), conservatives have managed to yoke pro-market rhetoric with a backward-looking, mostly reactionary social agenda that is inimical to the individual freedom at the heart of the capitalist enterprise. "The same politicians most prominently arguing for capitalism and less government interference in markets have also been pushing social views that each successive generation finds increasingly unacceptable," he writes. Donald Trump pulled just 39 percent of votes cast by people between the ages of 18 and 44. Conservative Republicans have effectively alienated Millennials and Gen Z, says Gulker, "who incorrectly see capitalism as part of an old order to be overturned."
Ironically, Karl Marx and Frederick Engels understood that capitalism is in fact a constant source of disruption and change. In The Communist Manifesto (1848), they stated,
Constant revolutionizing of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones. All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away, all new-formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses his real conditions of life, and his relations with his kind.
Almost a century later, Joseph Schumpeter updated Marx and Engels in Capitalism, Socialism, and Democracy in at least two profound ways. First, he pointed out that they were wrong in thinking that capitalism would destroy itself by "immiserating" workers. In fact, he noted, "the capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within reach of factory girls." Say what you will about supposedly stagnant wages and the like, but we live in a country where a record-high percentage (67 percent) of low-income high-school grads go on to college, more than double the share in 1980. And where more households are moving up the income ladder than sliding down it. Around the globe, a growing majority of people live at middle-class standards or above, thanks to liberalization of trade and other market-based reforms.
Second, Schumpeter coined the term creative destruction to more fully describe the incessant changes that affect the economic life in a free market (or "bourgeois") society:
Capitalism […] is by nature a form or method of economic change and not only never is but never can be stationary. […] The fundamental impulse that sets and keeps the capitalist engine in motion comes from the new consumers' goods, the new methods of production or transportation, the new markets, the new forms of industrial organization that capitalist enterprise creates.
[…] The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in.
The same sort of creative destruction also characterizes social and cultural life, as well, which is one of the reasons why libertarians (as opposed to conservatives) have long been champions of liberatory policies such as marriage equality (Reason has been calling for that since the early 1970s), an end to drug prohibition, increases in legal immigration, and the like. Change created by individuals endlessly discovering, expressing, and recalibrating their desires in both economic and cultural terms is the only constant. This sort of freedom doesn't lead to nihilism or iconoclasm in either the commercial or personal spheres. Rather, it allows for more options and the persistence of certain types of models and institutions that work, even as it gives more people the ability to run what John Stuart Mill called "experiments in living."
In the current political landscape, though, the main choices on display are free-market reactionaries (Republicans) and socialistic control freaks (Democrats). AIER's Gulker doesn't fault younger Americans for being confused and siding with the latter:
Suppose you're a 25-year-old who is neither expert nor ignorant in current events and economics. Those touting the virtues of capitalism are…offering a generally traditionalist worldview, not to mention specific social views you're likely to find retrograde. Without much understanding of economics, how can you see capitalism as anything but the status quo, the system currently in place where big corporations are run by old men? Some center Left candidates who seem more in step with your social views keep telling you this old order of capitalism needs to be further "checked" by government. And some Far Left politicians, with a little more conviction, tell you that markets are just another part of an old unjust order we need to leave behind.
Yet this would be ruinous, since it's precisely the creative destruction of markets that has helped generate exactly what young people like about the contemporary world—from smartphones to ride sharing to flexible workplaces to the near-infinite choice and near-instant gratification made possible by a company like Amazon. Gulker posits that it's up to libertarians to explain and sell capitalism as a decentralized, forward-looking, and responsive system.
Free markets coupled with local, voluntary institutions can bring about a society widely prosperous and caring beyond the wildest dreams of central planners like Sanders and Elizabeth Warren, and do so without distorting the economy or appropriating vast amounts of money from anyone….No generation is better poised to understand the power of entrepreneurial dynamism and networked bottom-up cooperation more than millennials. If that doesn't sound like a description of capitalism to you, you're not alone. Capitalism is not a hallmark of conservatism, it's the most surefire way to change the world.